start in the final quarter of the year. the dow and s&p both closing higher yesterday, the nasdaq, though, did slip slightly. october as you probably know historically is considered a rough one for stocks. that's in large part because of those big crashes that we had back in 1929 and then in 1987. but not lately. it is worth noting that the dow has not posted an october loss since 2008. so cross your fingers on this one. we do have a theme this morning, the hunt if value. we have three great guests who will be here to help you find places to thrive. first up is sam zell. he's our guest host today. we'll also be joined by bill ackman. so a lot to get through. also cliff robbins. and the heart and soul of the ryder cup team will be visiting us in studio. ian poulter gave the team a boost of confidence. yes, basically it is all about

ian poulter. he is the reason they won this cup. on sunday, he defeated webb simpson in singles in the come from behind win. more points than any player on either team. polster will ste poulter will join us at 6:45 eastern time. european shares are under a lot of pressure in early trading today, hurt in large part by doubts about the spanish bailout. reuters reporting spain is ready to request a rescue as early as next weekend, but german officials reportedly saying madrid should hold off. the news is creating a lot of confusion among investors and we'll check in with ross westgate in london in just a few minutes to talk about that. in asian market news, australia central bank cutting its main cash rate by a quarter point today to 3.25%. policymakers say the growth outlook for next year looks a little weaker while inflation

nation likely to remain contained within it target. and on the u.s. economic calendar today, monthly auto sales. analysts are looking for an annual sales rate of about 14.5 million new cars and trucks for the month. about the same as august, which is the strongest month of the year. among the katla tests, low interest rates, high trade-in values and new models. joe, can we buy and you new cyo new car? >> i've done that. not for me. we went big. we don't put a lot of miles on the car. >> how big did you go? >> i don't think you can get any bigger. >> we have a suburban. >> this is a suburban from -- this is like a suburban, but from a company that didn't take a bailout. >> an expedition? >> no. it's like an expedition, but it gives a little bit more panache.

>> oh, the cadillac? >> no. that would be by a bailout. >> don't ask me cars. i knew ford, but -- >> toyota -- >> no. i'm not going across -- i'm buying american. >> who is it? >> it's a navigator. a lincoln navigator. >> all right. >> you but it's like a land yacht. because it has an l next to -- which means it has -- >> you need a big car.because i which means it has -- >> you need a big car. >> i promise the carbon footprint -- we don't drive it very much. we put like 3,000 miles a year on it. >> it's okay. that's -- >> i promise you, 3,000 miles. >> don't worry about it. >> small footprint. >> compared to what jeeves is doing every day, i can't speak. >> you know i have small feet. no, i don't have -- i'm talking about my carbon footprint is

small. you have some big schlonkers. they're like 13s. >> no, 12s. >> high five. you go. >> i don't think that the hands and feet -- >> in corporate news, new york's attorney general -- of it area spitzer, do we ever think anyone is doing based on what they want to do? and there's an election coming up. >> do we ever -- especially they start out lawyers. so you're suspect immediately. filing a civil fraud lawsuit. i thought we did this. >> they lost. prosecution lost that one. >> against jpmorgan over mortgage backed securities packed and sold by bear stearns. the action first to come out of a work group created by president obama to go after wrongdoing. jpmorgan bought bear stearns for $10 a share in march of '08 and

we kind of thought they were doing the rest of us a favor. now they're like, thank you, sir, may i have another. the bank says it will contest the allegation. similar cases against other banks are likely to follow. scott cohn has been reading through the complaint as he always does. he'll have more at the top of the hour. and samsung will be allowed to sell its gallaxy it tablet in te united states. a court is removing a temporary sales ban on the twice. and samsung has filed a motion against apple saying that iphone 5 infringed on some of its patents. >> tit for tat. >> exactly. and boeing -- some words are for cable. i'd say probably -- >> tit for tat, there's nothing wrong with that. >> if you comfortable saying that. >> i am. >> you know how they cut

everything romney says, they cut out all the stuff on both sides of it? all we'll have for you is saying it tit, tit. remember faber, remember what he said? >> yes. the work on his finger. and you let him -- >> no, he stopped right after -- >> he stopped right after you said you what? >> yeah, anyway, boeing engineers and technical workers -- >> who did we have on last week who had a fluffer? >> a fluff off line of clothes. >> right, lululemon. >> is it not lululemon? >> in france it is. >> yeah, it is. what's happening here? the workers are voting to reject the pay offer from boeing. talks are set to resume today. a separate vote is required to authorize a strike so it doesn't necessarily mean it will happen. most experts say at this point that a strike is unlikely. >> we have another stock to mention this morning and that's google. shares hitting an all-time high

yesterday after the search engine giant's stock at this point is now the second largest on the nasdaq 100 index. of course apple the biggest. it topped microsoft's market cap earlier in the session. google has soared more than 15% year to date. >> and the world's largest retail trade association saying retail sales should rise 4.1% this holiday season. that's slower growth than the past two years. the group, though, says mixed economic data and political uncertainty are weighing on consumers. national retail federation president matt shay. >> we're confident that if the congress and the administration would resolve these issues, that this 4.1% projection would actually be quite a bit higher. >> as for the impact on the labor market, the number of seasonal workers expected to be higher this holiday season comparable to the 607,000 hired last year. >> did you see macy's put out a press he release yesterday, i think they're hiring about 2,000 more people.

>> but that's temporary or that's -- >> for the seasonal workers. >> you get that, too? >> i wrote him back. terry lundgren sent out a press release. i said why don't cow 't you comd talk about this. >> i said what about the parade this year. >> he it write back that he loves us, but he's not coming on. >> for a retailer, wouldn't you -- i'd like for a guy like that. really. i don't think i'd interview him. just send pictures. >> he spent a long team working his way through federateded. >> i know he has all this background. >> not even retail. just any ceo. >> this will get a little sickening, but he looks like before the super hero in a comic book, he looks like the guy that the super hero is before he becomes -- if you look at him,

they look like that. they he got the eyes and the sharp features. look at any comic book. anyway, he's blushing somewhere. he hates when people talk about him. let's check on the markets this morning. futures 5u7 s up 51 points. we got 77 yesterday. hard to understand. things in europe again, we follow every headline. and we think things are good when they tell us something is happy. and then we seem to sell it when it's bad. i don't know. spain going to ask for a bailout in all the same stuff swirling a away and what we're really keying off of is $40 billion a month right now. >> around the world. >> and remember how many people said when we do it, sooner or later everybody else will follow. so australia today is getting more accommodative. and the central banks around the world in a slowing global economy are going to open up.

we'll see where it all plays out, whether all current cities are suddenly represented in oil and gold, suddenly gold and oil are so high that any gains that you get in your market averages are -- >> and yet crude oil back at -- >> 92, yeah. expressed in either euros or dollar, it's expensive. the ten year note which we know is just able to trade wherever it wants and not being influenced at all by the fed, just at a 1.63%. look at the dollar which has been around 1.28 versus the euro. 1.29 today. and then gold was at a session high, i think it was at a euro all-time high yesterday. down a little bit today. >> right now time for the global markets report. ross westgate is standing by. while you -- >> two days now? >> guess who we get onset with

us. >> mr. poulter. that's fantastic. and is that the first interview he's done outside of the event? >> he may have just talked after the event, i guess, and i know he had a few guinnesss after the event. i saw a few pictures yesterday. but he had those same eyes. eyes scare me a little bit. i'm not going to be that nice. because he put a dagger in my heart. i'm going to talk about how well he played, but he put a dagger in our collective hearts over here. >> what do you want to ask him? >> i got a million things i want to ask. i want to ask when he really started believing. i want to ask him how much was it a euro win versus kind of a gag on this side. >> i want to know what did jose marie wlis thisper in his ear. >> he won't tell that you. >> we'll try. >> you know you got to ask.you .

>> we'll try. >> you know you got to ask. >> he's not your typical rich kid golfer. are they rushing here, saying get on with the markets over there? >> no, not at all. i would talk about this all day. >> i know you would. so would i. that's the problem. i see green and red. looks like the same old crap you're going to talk about, but go ahead. >> just one thing. the interesting thing about ian, when he was younger at his golf club, they thought his brother was a much better player than he was. he's a guy that has got where he has through shear hard work and determination rather than -- he worked at it. >> you you can scan see that. that was -- i mean, saturday and sunday combined, and then with his previous ryder cups, it was like a singular, i've any nevern anything like that. with a putt, i can't even read it, and if i did, the idea that

i would put the right stroke on it, but to be read it and then hit it every time. on saturday i don't think he missed a putt no matter where it was from. so i want to ask him how he does that, too. >> well, that's another great reason to keep watching the program. very excited about that. meanwhile things have turned around. we do have a little more green than red here on the stoxx 600. so advancers outpacing decliners by nearly 7:3. we it start down negative territory first thing this morning, but we've turned things around. ftse up 1.30 yesterday. here in spain, the best performer up 1.4% is where we stand. we had shall reuters report, becky talked about this a little bit earlier, that suggested spain was now pretty close asking for a bailout.

there are concerns in germany that they don't want to put different bailout requests in front of the german parliament. trying to see if they can lump them all together. both sides have denied that story, but its has had the impact of brings yields further down. ten year also lower. has had tht of brings yields further down. ten year also lower. returns of around about 20%. so good performance from italy, as well. as far as currency markets, reserve bank of australia cut rates by 25 basis points. weaker against the u.s. dollar. citing chinese demand slowing and of course the impact of that on their commodities markets, as well. jim o'neill was in with me this morning again talking about the shift in china from quantity to quality which he thought

actually would damage australia more and benefit somewhere like mexico, as well. so he has a trade on of short u.s. dollar, long mexico peso. back to you. >> all right, ross. stay tuned. 6:45. is it five hours -- i don't know. all right. >> half an hour. >> yeah, it's in a half hour. but don't you have to add five hours to that? no? coming up, take's weath etoday' of forecast and our squawk sports report. in person early voting begins today, but you tonight hayou do to prove it's you. who would ask for an i.d.? that's ridiculous. ohio joins 30 other states. and john harwood joins us to talk 308 ticks next. [ male announcer ] for the dreamers...

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let's start with monday night football. although monday night football seems -- i don't watch it compared to sunday night football. but anyway, the chicago bears beating the dallas cowbokou boc 34-18. tony romo matching his career-high with five interceptions. way to go. in baseball news, washington nationaling clinched the national league eastern division title last night.sing clinched national league eastern division title last night.ng clinched th national league eastern division title last night.g clinched thel league eastern division title last night. clinched the nation league eastern division title last night. their first division title since moving to washington from where,

andrew? the nationals are now trying to earn home field advantage throughout the playoffs by having the best record in the league. they are battling the cincinnati reds for that honor. and a programming note, ian poulter will join us in studio at 6:45 eastern. and he may show me how to fix my hair. i hate that song. now that i've had a day or two to deal with it, i loved it, i loved every minute of it. i don't like the europeans. i don't like them. but i love him. >> he made it all happen. >> he did. took it completely on his shoulders. no way they win this without poulter. so this will be cool to talk to him. and we'll make up some business angle to justify the time we spend on it. >>. so sore, right? >> he has a clothing line. he's a partner in sports yapper

where it's a twitter thing when you're watching. >> is ehe a net jets guy? >> he has the marquee on his shirt. >> just 25 minutes away. >> there's marquee jet guys, there's zip car guys. you're a zip car guy. unfortunately, we both are. >> jeeves is not a zip car. >> jeeves is a figment of his imagination. it's a stick. he has no helicopter. he has no skreefjeeves. >> you're not supposed to tell people that. >> that's why occupy wall street targets you because of jeeves and helicopter. >> the occupy -- >> occupy wall street, yeah. minute you bring that up, he gets nervous because they don't like you. sbl let >> let's get to today's national weather forecast. alex, good morning.

>> things getting a little wet in parts of the east. in fact the same system impanningiimpac impacting us in the south is starting to move that direction. here it is on the radar showing up across the mid-atlantic in the general motion will be taking it way on into the northeast. boston one of those areas that will stay dry for most of the day, but new york city, d.c., philadelphia, those areas in and out of the rain. we're seeing more here across the carolinas. also down into florida. quite a bit of moisture streaming on through. so rain gear certainly necessary in a lot of these areas across the sunshine state. and again it's all thanks to this storm system that will be in place for the day. the potential is also going to be there thanks to the system for severe storms. and we'll be watching that area in the red from the upper ohio valley all the way down on into northeastern florida. heavy rain a threat, but we could also see damaging winds and can't rule out that risk for tornado either. meanwhile, we flip the script and talk about wintry weather. wednesday, could be talking snow showers in montana and potential

is there for accumulating snow. a couple inches. so starting to see some of the signs of late fall and even winter out there. but before that happens, we've got some rather warm air to deal with out ahead of the main front that will bring us some of that snow. once that moves on by, look at how the temperatures respond. bismarck, 50 degrees there out ahead of the front, 84. but all those areas will be chilling down. by the end of the week, we'll be seeing temperatures for highs like we haven't seen since april. so big chill on the way for the middle of the country. >> thank you, alex. now on to politics. john harwood joins us from new york. not d.c. this morning. good morning, john. it appears to me, and maybe i'm wrong, but this election is now increasingly far from over if it was ever over at all before. i'm looking at a cnn report, also nate silver saying new polls raise chance of an electoral college tie. what do you know? >> i had no idea what nate's

talking about. t it is possible that we could have an electoral tie. highly unlikely. so i don't think the election's over. b obama has the lead. we still have a month to go. the next two weeks with three presidential, one vice presidential debates, we have a chance for mitt romney to set a different impression with the american people than he's been able to do so far. who knows what president obama will do and what events are happening in the world. but i'm not sure other than some tightening from a little surge that obama had which i think is receding a little bit, i'm not sure what nate is talking about. >> john, you wrote a column that talks about the debates and the impact of the debates traditionally. and made the case that traditionally it makes very little impact. >> there are many individual moments that make an impression. but to fundamentally change where a race is going is very rare and you need a combination

of events. the example that i used in that piece, andrew, was 2000, al gore had a lead of about what president obama has now entering the debates against george w. bush. he had a reputation as a strong debater. his body language was off, he was condescending to bush. bush was surprisingly well performed and personable. you had the bush campaign take advantage of some mistakes that gore made in the debate. and they really drove a story. cheney beat lieberman in the vice presidential debates. all those things came together and political scientists call it a wave effect. cause out with bush ahead a few points. >> couldn't you just say for an idiot, he was surprisingly well inform informed in say what you're feeling. >> i've never thought bush was an idiot.

>> why would you say surprisingly well informed? he was governor for -- he had a higher grade point average than al gore. >> because bush had a reputation -- >> with who? >> among people who cover him and among-mf. >> the media, you mean? >> a significant portion of the american people. >> i'm playing with you. i read what you tweeted, that you're ready for some debating with morning joe and at squawk. so you know this is fun, this what -- and i know exactly what you're saying. >> i want the record to be clear, i never questioned whether bush was smart enough to be president. but -- >> a lot of people misunderestimated him and his ext staregiery p i was going to talk to you about whether anyone still cares about cayman islands. the "new york times" decided to spend a lot of time -- not

really looking at benghazi or libya too closely or fast and furious, but they found more stuff that he's done under the law to maximize profits and minimize taxes. they got him ted dead to rights again. i don't know if any american cares. do you remember how the kennedys made their money? >> i think there was some boot legging. >> might have been a little boot legging. john kerry married and then left his yacht in providence or something, didn't he. and then john edwards flipping his magnetic business card at all the ambulances going by made $80 million. it's weird, isn't it? >> he was a good lawyer. >> and a hell of a human being, too, johnny. we have ten seconds. >> i don't think additional incremental disclosures about offshore investments will make a big deal. >> all right, my friend, thank you. when we come back, we'll get to kevin ferry from the cme, we'll find out what's most likely to drive action on the second day of the quarter. smart comes with 8 airbags, 3 a crash management system

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i was thinking about a reference to caddie shack with poulter. during the movie, he had a p putter that einstein had designed this thing where you just put the putter next to the ball and press a button and it hits all of it. that looked like poulter had one of those. >> do you you carry around one of those big bags?

>> good morning. welcome back to "squawk box" here on cnbc.those big bags? >> good morning. welcome back to "squawk box" here on cnbc. i'm joe kernen along with becky quick and andrew ross sorkin. our news maker, i think he might be in the house. ian poulter heart and soul of europe's team. most teams with 12 guys would have one heart, one soul. but he was both. rory was phenomenal and justin rose. but we'll talk to him about numerous business ventures and i don't know if he's had 48 hours to think about it yet, but he's had time to think about what he did. and wasn't happy with what he did. but at 6:45, we'll talk to him about that. i think do you know what he likes to do, he likes to beat the fans here, too, because they give him endless grief. >> sounds like somebody who has overcome adversity time and time again. >> the more people say stuff to him -- you know what, those fans

in europe are complete jerks, too. >> as opposed to the fans here? >> they're both jerks. we don't kill people at soccer matches at least. >> no, we do that after basketball games here. "usa today," the cover story is about an intentional 727 crash. discovery did this for one of their programs. they crashed it into the desert to see what happened. which is amazing because you want to find out who can survive these things. what is more unsettling is they talk about who survived the test crash. they say that passengers in first class would have died. >> always. you want to be over the wings. >> middle of the cabin might have suffered concussions and broken ankle, but those in the rear would have walked away. >> if i were to ask when the last time a big airline went down -- >> this was based on two big airline crashes. >> the last time it went down in this country, it would be the wrong question to ask because i don't ask questions like that.

i take it back. but unconsciously think about the last time we had one of those. with 50,000 takeoff and landings every day, we're sitting here, we're in much greater danger one of these lights will hit you right on the head. >> when i go on a plane, i go on the seat guru and try to figure out which is the exit row over the wings. >> you'll try and survive the -- >> i try. >> but this is what discovery does. they find stuff like this and like shark week and it's all of our fears. and i know the odds are not great, but we watch. >> since we're on the topic of planes crashing or not crashing, did you see the youtube video of the guy, the pilot who takes his h -- trying to get engaged to his girlfriend. but what do you call it when you propose, he's proposing. so he's in a private plane and he says he's going to crash and it's being videotaped and it looks like they're going down

and he tells her to go through the checklist of things to do. >> did she say no? >> no, she said yes. it is a remarkable video. >> no and i'd hit him and go find somebody else. that's a stupid -- >> that's a terrible thing to do. >> i believe he was a professional pilot. anyway -- >> okay. before we get to everything else we've been talking about this morning, we want to focus on the markets, as well. kevin ferry joins us from the cme. and we've been watching qe-3 very closely. i know you have, too. is that why you think we've seen so many green arrows recently? >> yeah, sure. i think that it's helped. the main thing is it's been extremely well advertised. so get a lot of criticism and a lot of talk, but we have to stay focused on what's working in the market and what isn't. so the one thing that we've seen both on the last day of the month and depend yesterday,

though, becky, in the middle of session especially the nasdaq, market seemed to lose the air from underneath it. so although that was kind of sketchy, we're encouraged by the fact that it was both instances the market found a bid and has been able to respond positively to it. >> what do you think's happening? >> well, i think that it's just more of the same and all over the world. so yyou saw australian currency down a little bit. yesterday you heard the japanese talk about getting back into qe by buying other people's bonds. that's an interesting play. they should get on that if they're going to to it. helps move their currency. they could move on the inside of twist over here.o it. helps move their currency. they could move on the inside of twist over here.do it. helps move their currency. they could move on the inside of twist over here. too many people are getting caught out of the market by trying to make value judgments about what the central banks are doing. you have to just recognize that they're committed to doing them and then move your money where you think you can make a profit. >> but is it fair to say, we had jim chanos on the program and

his point was all the quantitative easing is starting to mask what the market would normally be showing us about strengths and weaknesses with companies. is that the case? >> you bet. and the distortion is the key factor going on down the road. but again, this is something i was thinking about yesterday as the evans interview came around. and it was evident when you talked to plosser, these guys are writing off 2013. the first years they start talking about are '14 and '15. for the rest of us, we have to live them. so i think that the road can get a little sketchy. but they're clearly talking about holding down volatility and hoping nothing happens about so that that's where the fun starts. but in the meantime, you can't just disregard what's working positively. and i think that your tweet this morning was what got me looking at it with regard to krugman's piece and something to do with the deficit, is that going to be spun positively if they're

working on it or more fearmongering that something really heinous will go down. >> okay. so keep sticking with what's working for now. we'll keep an eye on this. but kevin, thank you. you always keep us up-to-date on everything happening down there. >> one more quick thing i'll say. watch silver. a lot of popularity in it. we didn't get an outright sell signal, but we got very bearish divergences for silver when it made a new high yesterday. trading over $41 on ebay for silver coins. well over the price in the marketplace. so watch out for that. could be an actionable trade. >> okay, kevin. thanks for the tip. if you have any questions, comments about anything you see here, squawk@cnbc.com. coming up, the chicago teachers strike back in the headlines this morning. we'll find out why next. and then ian poulter's in the building. attention golf fans ever where. >> look at that.

every player's name. unbelievable. >> got to be careful. >> i don't want to lose if because it's mine.

welcome back. the chicago teachers strike ended weeks ago, but not officially. today members of the teachers union will actually begin voting on that tentative contract approved back in september. completed ballots aree picked u tomorrow. the chicago public schools expects the new contract will be ratified at a meeting on october 24th.

>> a lot of people are tweeting about this. still to come on "squawk box" we'll hunt for value with legendary investor sam zell. i can't wait to talk politics also with him. i hope you had some coffee, andrew. >> i had coffee. >> he's pretty outspoken. you know where he's from, too. he knows how things work in chicago. first, though, the man of the hour, we will welcome ian poulter to the set. [ male announcer ] the 2013 smart comes with 8 airbags, a crash management system and the world's only tridion safety cell which can withstand over three and a half tons. small in size. big on safety. [ male announcer ] how do you turn an entrepreneur's dream... ♪ into a scooter that talks to the cloud? ♪

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hero of the ryder cup ended with a perfect 4-0 record. heart and soul. needs to be a statue. ian poulter is hear as you saw. thank you so much for coming this. >> thank you for having me on. >> there's no hyperbole to -- and i've said this. i'm not just going to kiss your butt because you hurt me very badly and you hurt a lot of american fans very badly. >> thank you. >> how many guinnesses after the match? >> there was a lot of alcohol consumed in that team room sunday night as you can imagine. the champagne was flowing on that bridge as you all saw and i think a few guys took a little bit too much of that down before that press conference. but it was good fun

nevertheless. >> what is it looking back, what is it about the ryder cup that does this to you? >> i just love it. it's the purest form of golf. no money involved. this is pure pride and passion. >> but it's our continent. you don't care about germany. you don't care about -- you probably don't even like germany. >> it's that whole trophy. >> you like beating americans. >> it's pride and passion. how can you you not go out there and give it your all. that trophy's meant a lot to so many people over the years. to have seve, just meant so much, you know. what that's done for the game of golf globally is pretty special. and i think for ollie to have seve on the left sleeve sunday was very special. it's meant an awful lot. >> the hair on my neck is standing up again thinking about it.

if the olympics -- i can't even imagine that the olympics if you were playing for the uk in 2016, i can't imagine that that would be -- would it be similar, do you think? >> i don't know. but that will be the first time we've ever played golf in the olympics. i'm not sure how that's going to feel. a lot of history in the ryder cup and that's with a creates the drama, the excitement and the buzz and everything about it. >> wouldn't trade it for anything else. >> i haven't won a major. everyone keeps saying about winning a major. to me, the ryder cup has been my majors. and i haven't won a major. but i wouldn't trade my memories and my time in the rye it tder right now for anything. >> recently it was a friday or saturday at one of the majors where i was thinking about betting on you. and i've seen the look and you were leading, i think, either after the second day or -- >> it was on sunday. sunday the p xwchlt a, i had a little run there. rory was leading. comfortably.

and i had a run of six birdies in a row on the front nine. >> somebody wrote in and asked if you you practice those. >> i don't know where they come from, but they're pretty scary. he scares my kids let alone anyone else's kids. >> i was watching and i'll admit this, i was watching on sunday and i was hoping that you guys kept it close and made a match of it, but i never really believed it. and i watched it in sickening slow motion train wreck as it sort of happened. but when did you think it was possible? you say on saturday? >> it was a train wreck. i have to be honest, you look at the board as it was panning out saturday, at one stage we were 10-4 down. that's 10-4. we were six points behind until sergio and luke managed to win their match. and they were up early and up a lot and the americans come back at them. and we managed to win that point. and that gave us the chance at

the back of the field there to turn that match around. and we knew if we could somehow get in at 10-6, it wasn't like we were we were that far behind. brookline, 1999, they've done it to us. >> that's what i was going to say. >> this will be replayed for the next 50 years and it's going to be you and those crazy odds. >> it's one team. >> i know but you know on saturday, do you have statistics how many putts you hit on 20 feet or less? >> i don't know, but -- >> did you miss any on saturday? >> not many. >> i saw one from on the fringe, i didn't think there was any way you were going to make it, you had to play it almost past the hole. you hit it hard, i was going that's sick. you had already hit about ten, now what percentage of it was you guys winning and what percentage was it the u.s. losing? i'll tell you this, justin rose,

17 and 18, that won it. >> huge. >> luke donald kicking butt of the guy who was hot on our squad, rory coming late and still winning. i admit furyk and stricker, but i think they, even with everything you did, if furyk made that putt you would have lost. >> everything had to be aligned. it was crazy. it was those first four matches were key and that's why the order got put out the way we did. we had to put blue on the board early. we had to silence the fans. we were getting it hard. >> what was the worst thing you heard? >> they're chicago fans. they're passionate. >> your guys are even worse, just as bad and the ole, ole, ole. >> stuck in my head, i've been sing something for days. >> the best sound.

>> the rivalry and the spectacle it was great. >> it's passion, i've never experienced anything else like it. >> ian what is it like being in the team rooms and the sense of camaraderie, does it last or is it gone in. >> it lasts a lifetime. the memories we get as a team, olazabal said it best, ryder cup is special, memories last a lifetime, moments like that mean an awful lot and that's why europeans have done unbelievably well. we embrace together. >> you hang together when you win. i'm sure the u.s. guys just went home. >> in hindsight i'm starting to question some of davis love's moves and i don't know whether other people, i might have started instead of putting tiger and stricker at the end i might have let the experienced guys, maybe that was their time to

lead. >> you can't screw up that. davis has done a great job. look at the pairings earlier in the week. they outplayed us. we were played off the park. this wasn't supposed to happen. >> could davis have said anything to anyone on sunday, done anything different in. >> the mistake he may have made was he didn't really believe it made any difference in how he sent out his pairings on sunday. he put them out to play golf, just needed 4 1/2 points. the guys are on electric form, let them go and play golf. didn't pan out. we had strength in the front. >> luke donald, have you ever seen luke play like that? >> he was well number one. >> yes. >> the guy is clutch. >> hit every approach shot five feet from the hole and sunk every putt. >> it was incredible, i love it. >> we promised to talk something else. >> sponsors, how many calls did you get in the past 48 hours?

>> twitter has blown up, i can't read them quick enough to respond to it. it's insane. it's really nice to get that kind of a response from everybody globally watched this ryder cup and watched history. >> you wear crazy clothes and pink colors. you had a clothing line for a while. >> i've still got it. ijpdesign.com. >> can you tell us any -- your revenue are going to, the revenues at ijp.com are going to go up. >> it's a young business, had it five and a half years. i've been passionate about my clothes and wanting to look good on the golf course. we are doing very well and hopefully we'll grow our small business to a big business. >> has there been an explosion in. >> it's been a day and a half, but -- >> the web traffic coming in. >> the web traffic i'm sure will go up. >> and with teixeira, you have

sport schapper. >> it's like a twitter forum for sports where everybody can talk about whatever sport it is they're following, whatever game they're watching live, they can discuss it, they can interact with everybody and that's great. sports fans are sports fans and they want to discuss and want to talk about all different kinds of sports and what's happening, what's going on. >> did you watch a replay of the whole, of the match? >> i haven't had two minutes to sit down. >> tiger still has it at times. you saw a couple of times, glimpses now? >> tiger is tiger. tiger can hit the best golf shots you've ever seen at any given moment. he's incredible still and that's why he's the biggest man in golf. >> and he will continue to win majors. >> he will continue. >> because it seems somewhat -- i've never sold him short, else'

my favorite athlete, mentally, well, now i don't know but he's so mentally tough and i would never short tiger. >> he will win more majors for sure. >> you will win more majors. >> if it doesn't happen i'm not bothered but i want to work real hard. >> you don't need to now because you appeared on bx bx "squawk b" congratulations, ian. i hear from jack welch and everyone, even though we lost, nothing like any of us have ever seen. >> plus singing "ole, ole, ole." >> thank you. when we come back, we have sam zell unveiling where he sees opportunities right now. stick around. we'll be right back. [ horn honks ]

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finding opportunities in business. >> you're not going to get growth unless the business community signs on. >> a length end dear real estate investor sam zell is here to talk politics, the economy and what he is seeing next on the housing front. >> the first presidential debatd in denver is a day away. >> a change has to be made, or the president one way or the other has to get on the ball. >> donald trump on the race for the white house and much more. >> activist investment bill ackman where he's placing his latest bets. the second hour of "squawk box" starts right now. welcome back to "squawk box"

on cnbc. i'm becky quick along with andrew ross sorkin and joe kernen. let's get you your line-up. first up we have real estate entrepreneur and media titan sam zell, he'll be joining us in ten minutes, our guest host for the rest of the program, sam's thoughts on housing, the economy and the race for the white house. also coming up at 7:30 eastern time, donald trump will be calling us on the "squawk" u.s. in line. at 7:45, bill ackman will be here with his thoughts on everything from retail to's and 8:10 eastern, combining shareholder activist and private equity, blue harbour's cliff robbins, where he's putting his money to work right now. we have a lot to cover this tuesday morning. before we get to all that let's get to andrew, he's got this morning's headlines. >> good morning, everybody. let's take a quick look at the futures. we have green arrows across the board. dow looks like it would open up about 53 points higher.

we're going to be watching shares of google this morning after the stock finished at an all-time high yesterday. google's market cap jumping past microsoft making it the second most valuable tech company in the world behind apple. american airlines is pulling eight boeing 757s out of service with a problem on loose seats. the airline says there may be an issue with a certain model seat and how it fits into the tracking used to secure it. joe? >> let's see, andrew, thank you. new york's attorney general seeking billions of dollars in damages from. morgan chase for alleged fraud that the beat stearns that would have occurred long before jp took over bear. cnbc has learned the case could be a wave in the future for perhaps other stuff. senior correspondent scott cohn is here. if i were jpmorgan i'd say eric,

bear stearns it's yours. we thought we were doing the financial system a favor, you go ahead and take care of it. >> it's one of the things that jpmorgan got when they got bear stearns. >> yes. >> it wasn't initially their choice but now they pick up this and for those demanding someone on wall street pay for the financial crisis well this may be the way they get their pound of flesh according to sources close to the case because there could be more lawsuits where this came from, the first problem of a mortgage securities fraud working group including federal prosecutors and attorney general announced by president obama in january. >> this new unit will hold accountable those who broke the law, speed assistance to homeowners and help turn the page for an era of recklessness that hurt so many americans. >> bear stearns did almost no due diligence on the underlying

mortgages while claiming to investors it did and the housing bubble burst and you know the rest. prosecutors have had almost no luck making criminal charges stick and the effort lost steam in 2009 when two bear stearns fund managers were acquitted on criminal charges. since then there's been little incentive for wall street execs to cooperate with prosecutors. according to a federal official, more than a dozen federal prosecutors and civil attorneys helped develop the case which new york attorney general eric schneiderman is bringing under the state's powerful martin act and that collaboration is potentially a model for future cases but won't say when the cases are coming or who they might be filed against. will it work? jpmorgan says it will fight the suit which involves conduct at bear stearns long before it was acquired by jpmorgan, over a weekend at the berehest of the

federal government. jp is cooperating with the government group and if this lawsuit works it may have some power and fuel. >> can i ask a cynical question? i looked through the lawsuit and looks like so much of the plaintiff lawsuits. >> sure does. >> plaintiff attorneys brought the exact same civil case. >> right. >> why do we think this is going to be a new model for anything? >> they say it's a model for the feds and the state attorneys general to work together. new york has this martin act that other attorneys generally in new york have used quite a bit in the past. >> to the extent that they bring more cases like this, civil cases, do you think this does anything to feed the public's lust for whatever you think, whatever you think president obama was trying to go for a year ago when he created this group in. >> if the public is lusting for ceos being perp walked over the financial crieses they're not going to get it with this and

may not ever because they haven't been able to build the criminal cases, they're tough to make, if there was criminal conduct you have to get the lower executives to plead or cooperate. >> is there anything to indicate there are criminal cases that could come from these things in. >> this doesn't read like a criminal case. it reads like a civil case, like a lot of the plaintiffs' cases. rather than focus on a specific deal like the sec suit against goldman sachs it talks about sort of a broad range of conduct, where we know these banks were churning out these mortgage-backed securities and based on this, doing this without a lot of care. >> is it harder and harder the longer we get from all of these actions? >> we're getting to the five-year statute of limitations on securities fraud, they're running up against that and you have the pressure of election time, presumably whether the administration changes or the administration and the justice department changes, people want to get things done so they're

running up against that sort of -- >> turnover even within some of the departments. >> exactly. >> scott cohn thanks for that report. let's talk about other headlines including a court victory for samsung over apple. the judge overseeing the patent dispute lifted a sales ban on samsung's tablet computer after a jury found the product didn't infringe on apple's patent. the galaxy 10.1 an older model but the lifting of the ban could help samsung in the run-up to the holiday shopping season. samsung filed a motion against apple saying the iphone 5 infringed on some of its patents. they vie for smartphone market domination. last year apple sued samsung in multiple countries and samsung countersued. it is october, we're think being the holidays. americans are expected to spend more during the busiest shopping season of the year but they are

also at the same time displaying more caution. the national retail federation says it is expecting sales during the winter holiday season to rise 4.1% this year, more than a percentage point lower than the growth in each of the last two years and it would be the smallest increase we've seen since 2009. the crash came up, people spent less in 2008 and spent more off of that relative basis. retailers depend on the last two months of the year for up to 40% of annual sales and the nrf is predicting merchants to hire between 585,000 and 625,000 holiday season workers. boeing engineers and technical workers rejected a four-year contract offer. they'll return to the bargaining table today to strike a new labor agreement for 23,000 workers. the union and boeing agreed beforehand to resume talks today if the proposed pact was voted down, the current labor agreement expires october 6 so they're still talking and it doesn't mean it's going to be a strike, it means they're going to keep talking.

some people say a strike is unlikely. we'll see. andrew? >> coming up next we'll welcome our guest host for the remainder of the program, sam zell. and bottom of the hour it's trump time, the donald, donald trump sharing his thoughts on housing, politics and of course the ryder cup. "squawk box" is back with sam zell after this very short break. comments? questions? send them to at squa@at@squawkc.

welcome back to "squawk box" this morning. checking futures, green arrows. dow would open 54 points higher, nasdaq a little over 14 and s&p 500 up as well. for the next two hours we are joined by one of the top real estate investors in the world. we are lucky enough to have sam zell, the chairman and co-founder of equity group investments here on set. thank you for coming in today. >> my pleasure, it's fun. >> nobody knows real estate like you do. we've been watching a lot of different things play out in this space. you were talking with joe off camera about qe3 and what you think about the fed's latest move. how does that shake things up in the real estate world? what does it mean for investing on the commercial and

residential side? >> the best answer i'd give you is that we were beginning to see the excess flow of capital, we're seeing too much capital chasing too few opportunities and consequently i think number one the effect of qe3 is nothing more than pushing up the stock market and yet the stock market is being pushed up at record levels of limited trading. we have low volumes and the market goes up, which is manipulation but it's a function of the fact, what's anybody going to do with money and nobody has any confidence in the future, so you limit your money to liquid. procter & gamble, anything that has a dividend is basically jumped for because there are no

other alternatives. look at your capital numbers last week. nobody wants to make commitments beyond tomorrow. we run a company that does a lot of corporate enterprise installations and one of their triggers is when the enterprise projects start getting delayed, we're heading for a recession, and that's exactly what you're looking at right now. you're looking at capital expenditures across the board being deferred and being deferred for a very good reason. they have no confidence. there's nothing that's going on now, qe3 or nlrb, that ain't building confidence. >> did they have any certainty when election comes? >> i think the answer is the certainty of the election is that it will be over. which ever guy wins is going to have to do an enormous amount of

stuff very immediately and very hard and based op. all of the other stuff we're looking at it's hard not to assume we're on the cusp of going back in a recession. >> that's frightening. >> well it's, the word frightening is too strong. the reality is that business is all about cycles. we did through positive and negative cycles and the opportunity for us is to take advantage of a positive cycles, so mitigate the negative cycles. what we've just come through is four years of a positive cycle that has been limited dramatically by political action. that's scary and that's not what's supposed to happen. >> we didn't get the bounce back that we were -- >> well, we created so many headwinds. we created so many issues and the environmental protection

agency and you'd think on what it does t isn't part of america's education. >> nobody, no president, not me, not any other president could have done any better over the last four years, given what he was handed in this, when you heard bill clinton say that, bill clinton has not said that before. >> i could have done better. you could have done better. i think anybody who wasn't ideologically driven could have done better. >> what would you have done? >> sorry? >> the meaningful steps. >> what wouldn't you have done. >> we need jobs so therefore -- and we need exports so therefore the first thing you do is have the nlrb attack the number one exporter in the country on really preposterous grounds, then you in effect start yelling at business and threatening business and then you get on the tv and talk about las vegas and all of a sudden the hotel business dies. i mean, the answer is that we

need leadership, not criticism. we need encouragement not discouragement and until that scenario changes i think the united states is quote/unquote, i hate to use this word, in a malaise. >> is that a function of new laws and legislation or a function of rhetoric? >> first of all it's both, okay, in other words, we hope that it's new laws. the reality is, it isn't new laws. it's using the executive branch to legislate by fear or by threat. you don't need a law. in effect the epa is doing stuff all over the place. the nlra is doing stuff that's not sanctioned by any law. it's a political decision and it's extraordinarily negative to our country and our economy. >> "the journal" did you read the lead editorial today how razor thin the obama care vote

really was. we know scott brown they had to do reconciliation after he won. gym webb fairly won, al franken sort of harvested the boats to beat norm coleman. those made a difference. evan bayh and jim weber saying we wish we hadn't taken 20% of the economy with no republican votes and legislated the most unpopular bill in history that's still unpopular and really poisoned the whole political atmosphere, at the same time you weren't trying to add jobs. it was almost an impediment to adding jobs. >> using reconciliation process on prapts the most important piece of legislation in the last 20 years, it is basically contrary to what america was built on, america was built on consensus. america was built on getting people on board, and legislating

accordingly, not in effect using a mickey mouse process to pass a staggering bill that nobody who voted for it had ever read. is this the way you run a country? >> i guess chuck, our friend, pushed jim webb on, wish he hasn't voted for it. no, but even getting him to admit and evan bayh. >> he said he wouldn't? >> he didn't say he wouldn't, they both have great regrets about the way it was handled and that's what got me about, and i think a lot of -- the country just listening to bill clinton and nodding. you could see the approval ratings go up and that maybe we're not such, maybe he couldn't have done anything and all of a sudden one speech from clinton suddenly we're not at 8.1% unemployment for 43 months? >> come on. the reality is that bill clinton was a politician. what we need in this country is

a politician. hard as it is to say that. >> somebody to work with both sides. >> in effect who says my objective is this. now who do i have to corral to get from here to there. that's called leadership. we know the stimulus bill is just sent down to nancy pelosi and she wrote it. president had no input. dodd-frank same thing, obama care similar. there's this cadre of people writing the laws of our country without input from at least half the country. >> what's the most important thing you think needs to be tackled head on. you think the fiscal cliff is the first issue? >> there are a multiple of issues that have to be acted on and obviously the fiscal cliff is a very important one. the trouble is the fiscal cliff is probably too easy to solve and kick down the road, and so

therefore i doubt we would be in the fiscal cliff. i'm not sure, to be honest with you, that a fiscal cliff falling off the edge is not exactly what america needs. >> is this a wake-up call do you think at this point? it's a pretty severe wake-up call to get. >> you're describing a wake-up call to rip van winkle. how many years have we been kicking the khan down the road. that's a wake-up call for rip van winkle, somebody who has been sleeping for a multitude of years. >> you're suggesting play with fire a little bit? >> i'm suggesting that i'm interested in solving the problem and have you ever solved a problem without playing with fire? have you ever solved a problem without going to the edge? have you ever solved a problem with fear and uncertainty? i certainly have. i do that every day. that's called taking risks.

you assess risk and reward. that's how our system is predicated on, that's what built america and we have to look at every option with that in mind. we've tried everything under the sun and every solution has kept kicking the can down the road. ersk erskine-bowles, it's inconceivable that wasn't endorsed by the president who in fact created the entity in the first place. so people keep playing games but the reality is time is running out. and if kicking the can down the road doesn't solve the problem, maybe you've got to do something else, and maybe the only way you can convince the american people that we really have a problem is to create one. >> we're going to talk more about this in a moment. we did have some people who were here earlier this week with some thoughts on simpson-bowles if there's a way to bring it back. would you be in favor of that in. >> i think that's too broad a

question. there are obvious elements of erskine-bowles that are terrific and basically represent compromise, to say the whole enchilada is -- >> that's the problem if you pick it apart bit by bit what you like and what you don't. >> go back to our friend bill clinton, what was he so good at? >> getting both sides together. >> he got his rear end handed to him in the election. what did he do? he responded. what did president obama do? he went further to the left. so are you listening to me, american people, or are you ideologically driven, so that you in effect hear nothing. that's the $64 question or maybe $64 billion question. >> brilliant. >> we're going to talk more about this with sam zell, our guest for the rest of the program. when we come back donald trump will be joining us on the "squawk" u.s. in line, we have politics and business colliding in just minutes. stick around. "squawk" will be right back. sym and the world's only tridion safety cell which can withstand over three and a half tons.

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welcome back to "squawk box." in our headline this is morning, u.s. automakers will be out with their september sales figures today, edmonds.com estimating the overall increase of 8.8% from a year ago, and bank of america's merrill lynch unit reportedly planning a talent raid on morgan stanley's wealth management group. says many of the brokers are ready to defect for a variety of reasons including apparently a difficult computer system conversion and the problems surrounding the facebook ipo. holiday season competition is ramping up. toys "r" us will offer a price match guarantee for all of the products it sells, also giving customers seven days after purchase to get a price adjustment if they find a competitor selling the item for less. one key exclusion, it won't match online offers from competitors.

two of the nfl's marquee teams meeting up on monday night football last night, the chicago bears defeating the dallas cowboys a score of 34-18. tony romo throwing five interceptions, helping the bears lock up their third victory of the year, and another story here, victoria's secret opening a store in cowboy stadium last night. the store featured cowboy themed gear. this is the first store to open inside a stadium. we are on the eve of the first presidential debate, expectations running high. chris christie making a bold prediction. >> he'll come in wednesday night, lay out his vision for america, contrast his view and the whole race will be turned upside down come thursday morning. >> joining us on the "squawk" u.s. in linewsline, donald trum.

thank you for coming on as usual and good to talk to you. have you heard you can't win on a debate but you can lose one. is there any truth to that? >> i think you can win on that also. in fact i'm supposed to be going to europe and i'm canceling the trip or postponing it because i definitely want to be watching this one. it's going to be a very, very interesting debate, and if you remember florida, mitt romney went into florida, he was not looking good, and he did two debates where he just absolutely crushed it, and it's interesting. i think mitt romney will do very well. i think the president will do very well. it will be very interesting. >> sometimes i wonder about the difference between mitt romney, the man, and mitt romney and the campaign, and his handlers, a lot of consultants around, i think, because people have said on "60 minutes" he was so, seemed so sensible and so smart. i haven't seen him around much

for the past three months. >> he's going to get tough and not going to be mitt, he'll have a bad resolution. the fact is, he is a very capable guy, a very smart guy. can he be a very tough guy and he's also got heart. >> when you let the press, when you let the media, donald, define him for three or four months and you never really see him out there, i think that was -- when he's on his own and when you can hear him talk and when they can't cut, "i like to fire people" before he said that if i have an insurance company that's not doing its job, but the media takes just the snippet from the middle. >> exactly, they said all they left was the word "fire." they didn't say, "if people do a bad job" et cetera, it was terrible. he should have attacked them on that. i know him well, he's a great guy, a very capable guy, smart

and he's going to do very well but the campaign has to start as of this morning. >> you've been watching the show this morning in. >> i have. >> what do you think of sam zell's comments? >> i think sam zell is great and i also think ian poulter is great. i was with them during the ryder cup, two great people, very, very different, very different hairstyles. >> different and similar, though. they call sam the grave dancer, not the bulldog but both are pretty the tenacity is there for both. >> they're both handsome men. >> and as you are as well. so i just wonder what we see in this debate, whether, should romney, you know, up to this point it's been the president's a really, really nice guy. really likeable guy and is it going to be that or is he going to, do you think he's going to start pointing to some of the last four years and some of the

shortcomings for what we were hoping for? >> i think the nice guy stuff is over. he's not going to be saying that anymore. i haven't heard him say it recently. he's been attacked so viciously and very unfairly. i don't think he's going to be saying it and i think he's going to be in attack mode. it's going to be a much different mitt romney, going to be very strong and very smart and he's going to attack the president on what he can attack him on which is the economy and jobs. >> sam? >> hi, donald, good morning. >> hi, sam, how are you doing in. >> good. thank you for that wonderful comment. obviously you appreciate my hair style. >> i think it's beautiful. >> but i think the question is, how realistic is it and are all these polls we're seeing which suggests the president is turning things bluer, how true are they? how difficult is it for somebody to run against the democratic party and the newspapers at the same time? >> it's very difficult and

y you look at the polls and they are doom and gloom, most of them very negative for mitt romney and that's really why he has to go in attack mode. i think you're suggesting i'm not sure the polls are correct. lot of people say the polls aren't correct. who knows but the fact is they're negative and he's got to go very strong and very smart. >> on the other hand done tald at this point in the carter/reagan deal and in the gore/bush deal, at this moment, if my memory is correctly the numbers were about the same. >> dukakis. >> a lot of movement. when you get 35 days that's an eternity in politics. one day is an eternity. so many things can happen for the better and for the worse and i've seen it and sam, you've seen it. we've all seen it where somebody's winning in a landslide and all of a sudden things happen. we've seen people have to get out because of scandal, let's assume that's not going to happen, but we've seen so many different things happen just at the end, so 35 days that's a

long period of time politically speaking, a lot of things can happen, as it did with president reagan, as it did with, hey, jimmy carter was a sure winner. he wanted to run against reagan. that was his choice and they were hoping and they made a big mistake to lots of things can happen and tomorrow is day one. the debates are going to be very, very important. >> i thought you were going to ask him about -- >> "new york times" nothing on benghazi here that i can see, donald, but we got more tax stuff, cayman islands stuff. do you think the american public still cares about romney's taxes at this point? >> not too much but i think very interesting is that i read this morning where al qaeda is taking over libya, it looks like they're going to be taking over libya. we free up libya, we get rid of gadhafi, we spend our billions of dollars and lots of missiles and help people that we never met before, we don't know and hear bad things about, the

rebels and now as we understand it, al qaeda, because it's so weak, al qaeda is now going in and taking over the weakened libya. unbelievable. >> donald, one last question and maybe you can react to this, today's "wall street journal" alan blinder has an op. ed and writes this, "presidential history teaches us that the abilities, character traits and attitudes it takes to succeed in business have little in common with what it takes to succeed in government, in some respects they're antithetical. i was surprised. did you get a chance to read it in. >> there's a little bit of truth. take sam zell, say sam wanted to run for office. sam, i know him well, an amazing business guy, an amazing guy but he's beaten up a lot of people over the years fairly, by the rules, he keeps winning, winning, winning. if he decides to run for office, he's got such a strong record in

one way i would say a phenomenal record. somebody else would say every move he makes will be a television commercial. it's very hard for a very, very successful person to run for office. now once they're in office, i think they'd do great but it's hard to get there, in my opinion. >> the converse is that people with a lot of government experience are actually good at government. that makes sense, good at growing government and good at being part of government but i don't know -- >> the right person in that office could do wonders for this country. >> it should be about jobs. it shouldn't be about taxes. it should be about jobs, jobs, jobs. donald trump, thank you. >> so long, so long, sam. >> bye-bye now. coming up next, bill ackman's big investing idea the activist fund manager joining to us discuss where he's putting his money to work plus why he's putting pressure on p&g to get rid of the company's ceo, that interview coming up after the break. [ male announcer ] for the saver, and a big first step.

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into a high-tech masterpiece? ♪ whatever your business challenge, dell has the technology and services to help you solve it. welcome back to "squawk" this morning. our next guest saw over 1,000% in his investment in general

growth partners and pushing to add new value to the price. joining us is famed active list/investor bill ackman, founder and ceo of pershing square capital management, a lot to talk about what's going on at p&g and jcp as well. on general growth you are trying to push a deal with simon properties. >> let me explain, general growth has been a good investment and we actually started off with brookfield as a partner and they've been a good partner to date. the problem is that they're pursuing their own agenda to get control of the country. >> let's set the table for a second. >> please. >> there's three companies here. there's general properties, general growth. >> mall company. >> there's simon. >> yep. >> and then there's -- >> brookfield, big shareholder. >> you're worried about brookfield taking over the company. >> correct. >> that's one of your worries. >> without paying a premium. >> and at the same time you're

trying to push a deal with simon and unclear whether simon wants to buy the company. >> no, it is clear. >> it is clear? >> yes. >> even though recently they came out and said they don't want to buy the company. >> sure that's what they always say. >> the oldest story in the book, the question of price. >> it's always a question of price. >> so let me lay it out for you. board has a duty to its shareholders to protect the assets of the corporation, one of the most valuable assets of the corporation is control. sam would tell you how valuable control is. it's worth $6 billion to $9 billion, the kind of premium shareholders could receive in a sale transaction, a merger with simon. brookfield wants that control premium for themselves and they're self-interested which is perfectly legal, they own 29% of the company coming out of the bankruptcy, they now have 42% if you include warrants. 38% of the shares they can vote so getting close to a position where they can stop the company from being sold so we, what happened here is in october of last year we sat down with simon

and we proposed a transaction where simon would buy the company in a merger to general growth shareholders would continue to own about a 30% interest in simon going forward, david liked the deal and he said look, but before i spend any more time, tell me whether your partners at brookfield or blackstone are interested. blackstone said sounds great to us. we began a process going on for 10 or 11 months where brookfield has been working on a deal to buy the company sore so i thought. what's really been going on working up setting up an entity called brookfield property partners and the entity will end up with their stake in ge growth and they want to keep general growth forever. if they keep it forever shareholder also miss out on their control premiums so to lay it out we asked the board in light of the situation, brookfield will get control of this company, creeping every quarter buying a little more shares we're going to be in position where the control premium will be taken away from us. we want to you protect us, form

an independent committee of directors. >> i'm going to sam. what should happen? >> first of all i think you got to go back to history and history of canadian companies is all about not paying for control, not buying 100% of another company and maintaining control by loning blocks, parent company as"a" controls company " and when you stretch it out you are creating massive asset control with very little capital. now unfortunately that's exactly the business they're in. you want them to change leopard clothes or something, the idea you talk to them and you thought they were going to buy from you, i mean that's tooth fairy stuff. they weren't going to buy from you.

>> sure. >> the real question i'd ask you, bill, is don't they have control today in. >> they don't. the reason why they don't have control today when we did the original deal, we did a few things, we're not permitted to vote their shares over 10% of the stock they own for their own, for the other directors, this ef they have to vote their share in proportion. we could fairly get control of their board. the second thing is they're getting closer to control with 38% but in a premium transaction structured as a tendered and exchange offer we're still fine and even if that, we had difficulty getting the votes because mechanically people didn't return their proxies there's precedent for a board granting an option to acquire to buy 20% of the stock of a company as a way to facilitate a transaction. jpmorgan buying bear stearns had trouble getting the deal done. they said we're going to sell you "x" percent of the company. there are things that can be done. we need a board to be vigilant. it will be easier if we have a

willing buyer, we have and by the way -- >> what's simon's price? >> i think they'll do a deal that's economically accretive to them. >> there's got to be a number. >> we showed in a deal yesterday which would be a 30% premium to the unaffected price, get stock in simon, be $24 to the general growth shareholder versus $151 simon stock, that's the exchange ratio. because the deal is so accretive to simon, meaningful revenue synergies and cost synergies, we believe the stock would trade up significantly and the $24 would go to $29. >> is david simon going to do this? you know him. >> i think david is very good, i think there are issues here, i mean i don't understand whether there is an anti-trust issue although you could sell off stock and solve that problem but david's been embarrassed a couple of times already where he's made offers that have not

been accepted and i suspect he's not about to go play a third time without a specific scenario on the other side saying if you do this, we will sell the company, i don't see him sticking his neck out again and getting him embarrassed. the minute you stick your neck out, you're saying come get me, and everybody in the world is for sure going to come get the winner. i think david will respond to an opportunity if one gets created. i'm a little more pessimistic, whether you vote 38% or you own 38%, i'm not sure it makes that big a difference. and as i found out, frankly, in a lot of other deals we've been in, there seems to be a cadre of investors who always want to preserve the status quo and i've been in situations exactly like you and they say this is so

logical. obviously, and somebody comes up and says i've been there for 0 years or been there for five years, this is a great investment and i don't want anybody else to run the company. if 12% of the people decide that's what they want to do, i think brookfield has control and i actually think brookfield has semieffective or semiuneffective but semiform of control today. >> if they don't get pushed you have to get the word out. >> i agree a lot with what sam says. david was embarrassed during the bankruptcy. his mistake each time we told him what he needed to do and he wasn't willing what he needed to do. this time i'm david simon's best friend. i am going to deliver -- >> this week. >> -- i'm david simon's best friend, i'm going to deliver a transaction very attractive to simon. the way the board analyzed the

transaction, they looked at as as if we're selling the company. in a transaction they own something like 30% of the combined company. we're not cashing people out. we're not looking to are a short term pop. we're merging and more levered company with less levered company with a strong management team. >> if you are going after p&g the whole company you might want to -- >> team up with -- >> you got 1% or something? i mean -- >> we're not going after p&g. >> while he's here, he should ask. >> you're trying to get rid of the ceo. >> p&g is one of the great companies of all-time, been in growth for 75 years it's stumbled over the last several years under the current ceo's leadership, and we've kind of laid out what our concerns are and i think our concerns are not our concerns. they're the concerns of all the shareholders. >> do you think your concerns are being heeded? >> absolutely. we were received at a very

seriously by the board, we had a great meeting with the lead director and ken chernault and bob mcdonald and laid out our concerns. bob is focused on succeeding and keeping his job, it's a good dynamic. the board wants to give him a little bit more time and see if he can make some progress and if not, this is one of the best boards in america. >> what is the real problem? it's something built up over the years. >> part of the problem is there's not a culture of efficiency, let's put it that way at procter & gamble. it is a fat and bloated company. competitors are nimble, have better cost structures, allows them to reinvest in growth the company has not been able to. you look at unilever, making the company much more efficient. >> the '90s with dirk jagger, mick jagger, whatever, and lastly procter & gamble, you were talking about the last

couple of years, p&g was turned around, sounds like we're back to the future. >> there was a problem and the board stepped in and they found someone internally, someone who has been one of the great ceos of procter & gamble. >> what is your next move if nothing happens at p&g? what cards do you have to play? >> this is the most public statement i've made about p&g. all we've done is bought some stock, sat down with the board. this is a high quality board, a group of very talented ceos, operators, not on this board to receive a director's fee. they're on the board to do the right thing and i'm confident they'll do the right thing. >> you teased in this investor conference you had a secret short position. >> yes. >> would you like to share your secret with us? >> not yet. >> can you give us a hint in. >> i'm sure it's sam's company. no. >> which one? >> what industry? >> i can't say. >> we have to go to commercial.

>> i'm happy to talk about it when i'm ready. it's a good firm, as soon as the company goes out of business the country will be better off. >> i don't know what to make of that. much more from sam zell. watch "squawk" tomorrow, jim tisch, guest host, of the lowe's corporation. small in size. big on safety.

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when we return, much more from our guest host sam zell. he's already talked about how all the signs he's following point him towards a recession right now. we're going to hear more about

that. stick around form the top of the hour. by the way in just about 15 minutes we have cliff robbins, ceo of blue harbour group giving us his expert investing advice. "squawk" will be back in two minutes. [ male announcer ] you are a business pro.

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i was downstairs making coffee, and we heard it. it just came crashing through the roof, out of nowhere. what is it? it's our ira. any idea what coulda caused this? maybe. i just sorta threw a little money here, a little money there. and i loaded up on something my dentist told me was hot. yeah. ♪ an investing icon talks

politics, the economy and your money. >> how many years have we been kicking that can down the road and now we have a fiscal cliff and this is the wake-up call? you know, that's a wake-up call for rip van winkle. >> one more hour with guest host sam zell. the activist, investor behind names like jack in the box, qdoba and chico's, we'll talk to cliff robbins about private equity, and the health of the buy and hold model. the first real privatization deal in greece in recent history. the greek government is selling a state run enterprise to a private company. is this a sign of things to come or symbolic gesture? find out as the third hour of "squawk box" starts right now. ♪ >> we talk a lot about, yeah, welcome back to "squawk box"

here on cnbc. that was like ten minutes about general growth. first in business worldwide. i'm joe kernen, this is the lovely and intelligent becky quick. >> thank you. >> handsome and dashing andrew ross sorkin is here. guest host billionaire sam zell, chairman of equity group investments. when i was a stockbroker i bought itel, people thought it was intel my clients were confuse. >> they did better in itel an intel. >> rusty rail cars no one was using until the economic economy so they're probably rusty again. also coming up our hunt for value theme continues, activist investing in portfolio strategy with cliff robbins, ceo of blue harbour group. i like jack in the box, qdoba and i like chico's. i don't like burger king. they can't get their fries right.

>> they make great chicken sandwiches. >> they spray that smoky stuff, they actually don't bei don't like that char boiled, that faux -- anyway greece making good promises to privatize state-runnent prizes. we'll talk to a ceo taking over a mall in the country's first privatization deal of the year. first becky has your top stories. >> new york attorney general is filing a civil fraud lawsuit over jpmorgan over mortgage backed securities packaged and sold by bear stearns. the action by eric schneiderman is the first to come out of a working group created by president obama to go after wrongdoing thatcrisis. this is jpmorgan of course. the bank says it will contest the allegation, similar cases against other banks are likely to follow but again something on the criminal prosecution at least did not succeed. also samsung's going to be allowed to sell its galaxy tablet 10.1 in the united

states. courtroom removing a temporary sales ban on the device after a patent dispute with apple. samsung said the iphone 5 infringed on some of its patents as well so this is the back and forth between the two companies and american airlines has temporarily grounded eight planes, they're going to be evaluated after seats became loose on three different flights over the last three days. there may be an issue with the model's seat and how it fits with the tracking. it's been a hinlg issue and talked about it on "nightly news" last night. >> and bankruptcy as well. u.s. equity futures we got some green arrows across the board as we look at it there, dow would open up about 53 points higher, s&p about 7 and nasdaq about 15 points higher. overseas in asia, a little bit of a mixed picture, not horrible, not so bad. i'm just looking through that and let's take a look at the

european equities at this hour, the ftse up, the cac up and the dax up as well. reuters reporting spain is ready to request a rescue request as early as next weekend. german officials saying madrid should hold off, the news creating confusion among a lot of investors, so we have to keep our eyes on that one and a stock we'll be watching this morning, google. shares hitting an all-time high yesterday, the search engine giant's stock is the second largest on the nasdaq 100 index, and topped microsoft's market cap earlier in the session and google soared more than 15% year-to-date. >> i wonder where that would have put it andrew, but apple is so far ahead of google that doesn't put google above the biggest s&p 500, you know, the other, or the dow, obviously. i'm looking to see the market cap, got to be significant at

this point, 250. exxon. >> a long way to get to apple range. >> our guest host this morning is sam zell, and we've been over a lot already to you. i loved hearing your business acumen. i love it when you talk politics. do you feel like it's a new normal that you've heard el erian and others at pimco say there are structural things in the job market due globalization that have us in a permanent malaise or do you think some are fixable with the right policies? >> i think all of it is fixable. i think that one of the ways you justify kicking the can down the road or not doing things is you say oh my god, it's structural. it's this, it's that. i mean, unleash the animal

spirits of america. unleash the small businessmen. unleash people like me, okay? i'm a very wealthy man. i could literally put my money into the bank and play golf every day. god forbid. but i could do that. instead, i'm taking risks every day. why? why should i? if the game is being stacked against me so what this country needs is a clear, an all clear sign and all clear, let's get back to business. that's what creates jobs, let's get back to business? stop this class warfare crap, stop this politics and envy, and in effect deliver a position to the american people that says we have to drive a center, which is what we have done since the beginning of this country and what has led to its success.

>> there are things you haven't done, sam, are there? you are taking risks. >> oh, sure, in this environment, i mean, you know, we're watching liquidity like a hawk because there's great sense tomorrow morning it could go the other way, in effect you don't invest as much, you don't take as much risk. >> how would you counter the argument that businesspeople and the wealthy have had their way for the past 2030-years as they've increased their lead in terms of income disparity and gotten richer and richer, and you would have hoped that some of that would have trickled down, if it works you would have hoped the average person would have participated in the good times and haven't and you need a president that is going to come in for the powerless people that aren't able to set policy and pay to go do things and you need someone that will represent them in the future.

how was is that pretty damned good? >> yes, sir. >> you can take this. thank you for writing it for me. >> i'll get you a job at "the new york times." the reality is as follows. the whole focus has been on how the quote, one percenters or ten percenters, how the top earners moved ahead of everybody. is there any correlation between while they were moving ahead the rest of the government was subsidizing and subsidizing more and more people and disincent e disincentivizing them. why is it always assumed somebody doesn't succeed because he can't as opposed he doesn't want to. >> because the opportunity is not there and it's not a fair playing field which i've heard for the last two years. >> i'm sorry, i live with the playing field every day. i finance people starting new businesses, taking all kinds of risk. their motivations are the same

as everybody's since the beginning of time. >> there are people who have done multiple studies on upward mobility and there's no suggestions i've heard that the reason why people have had a harder time rising through the ranks today is a function of the fact that they're disincentiv e disincentivized in the rise to the ranks. >> wait a minute, i think they are disincentivized by in effect if you don't have to pay for your health care it's another thing you don't have to worry about. >> you wouldn't make that argument about europe. >> how successful europe has been. >> it's the difference between earned success and now i'm back on the difference between earned success and learned helplessness. we're learning helplessness and learning it really well because we have a great teacher. >> all i'm saying is that, go back in history. show me any country in the world that has "progressed" successfully without engaging

the animal spirits of their people, and without creating opportunity for their people to excel and push the envelope. >> i've had these toqueville quotes up, once you know you can get 50% of the vote, it's hard to, you know, it's hard to screw that up and not get reelected when it and again and again. >> you don't think there's been so many benefits, and this is why i think to the extent we talked about earlier, to the extent people looked at mitt romney's taxes there have been so many benefits built into the tax code and other things to help continue to the sort of progress at the time. >> for every step there is is an additional step on the bottom to increased the earned income, to extend unemployment insurance for 28 years. >> that is what's maybe helped

at the top? >> no, i don't think there's any correlation. >> meaning the fact that we've flooded the system with so much cash -- >> andrew, the world is not a zero sum game. if i succeed, it doesn't mean that you don't. i succeed because i'm driven and i take the risks and deal with it. you succeed because you're driven similarly. and that's fine. but that's what it's ball. that's what it's always been all about. >> i don't disagree with you for one second. we have to run to a break but there is an issue of what's happened with globalization and technology, all of these things which displaced people at the lower end, so there are structural issues that i hope you agree there are some structural issues beyond welfare. >> there are structural issues all the time, okay. there isn't an extra special number of structural issues today versus yesterday. go back to teddy roosevelt and

the trust buster days. there were structural issues that created that situation. there were structural issues when fdr started the new deal. there are always structural issues. the question is what are the solutions? >> sam, you've talked about the education system. >> i haven't even begun to start on that subject. i mean the idea that we instead of saying this country's standard must be the highest educational level in the world, the standard is, how do we keep the greatest number of failing teachers in place so we can be fair? well, that's not fair. if you're educating a kid from the hood and he wants to learn, and instead of getting a teacher who wants to teach you, he gets a teacher who views your job or his job as a custodian, that's not fair.

that's -- what is happening at the educational level of our country, in particular in the have nots, is, you know, is racist, is unfair, it's everything you can imagine, because you're dooming these children. you're dooming them. >> at least you fixed it in chicago. >> right. oh, yeah. >> we're going to have a lot more with sam as the program progresses. >> that was great. coming up the activist investor behind names like jack in the box, and chico's, blue harbour's cliff robbins will talk about the environment and investments. and toys "r" us announcing a price match guarantee for all of its products. one retail group is forecasting slower growth this holiday season than the last two years. we'll bring thaw story later this half hour. smart comes with 8 airbags,r3 a crash management system and the world's only tridion safety cell which can withstand over three and a half tons. small in size. big on safety.

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we're back this morning on "squawk." pension funds are under tremendous pressure to find value in a low interest raid world, beginning to respond to that pressure taking a more active role in their chechlts. joining success cliff robbins, ceo of blue harbour group a hedge fund that takes a private equity approach to the public markets. blue harbour manages over $200

million for the california teacher's state retirement system, he's an old partner of henry kravis and used to work at general atlantic as well. we had mr. ackman on before, he takes a different approach to activism. what are you doing? >> i think it's important to tease out the difference between active ownership which is what we do and activist investing. it's a little confusing. in the corporate world activism is different, it's aggressive, from our business. i've never done a proxy contest or sued a company. we're backing companies where there's scope to unlock value and identified companies to do so. >> if a company doesn't want to talk to you, you leave them alone. >> it's more about the quality of the conversation, if we are engaging with a company and they seem to be closed minded and not open to new ideas we would invest. if on the other hand they're

interested in probing ideas and looking to are ways to win this could be a good opportunity. >> let's talk about pension funds. in this qe3 world where you can't make a buck with owning treasuries, what do you do? >> it's a big problem in the pension world and for institutional investors more broadly as bernanke has told us, rates are going to be low for quite some time, traditional asset allocation has some 25% to 30% invested in fixed income, putting pressure on fixed income in particular so they're looking for ways to make higher returns in the other parts of their portfolio and active equities, which is what the activists do and active ownership players like blue harbour do are providing real alpha and this is a solution and other thought leaders in the space are pursuing. >> so mr. zell predicted, i don't want to put words in your mouth but you did suggest we could be on the verge of another recession. >> absolutely. >> what do you make of that? how does that change your

calculus if it does at all. >> i'm investing with a two to three-year horizon, we're looking for value over that time period and i've been investing for about 25 years. i've never seen such a high spread between the cash return in the market and the risk free rate so i'm over a two to three-year horizon i'm seeing the economy healing and -- >> the real economy, not just the stock market bernanke economy. >> particularly in the small mid cap space we're investing, the companies tend to be less international and tend to be doing well. most, if not all are having record earnings this year. there's much so be worried about in the economy but the underlying economy is healing. >> you're talking about the consumer strength basically? most companies are consumer oriented. >> the consumer has been strong, industrial manufacturing has been strong, software has been strong, you know, it's -- i'm not generalizing the whole economy but our job is to find value in the market and

certainly our companies are building cash flows and where they're importantly finding ways to unlock the value. >> joe is a fan of jack-in-the-box. >> i am. in contrast -- >> i am a fan of chico's. >> in contrast to other fast food chains although there aren't many i'm not a fan of. >> that's obvious. >> i like jack-in-the-box, too. the play on jack in the box, they used to have a corporate parent in the day so they wind up opening their own stores. >> they called it food makers. that's how stupid they were. >> they owned 70% of the stores so they had a low return on a capital vested business model and almost everyone else is a franchise model because the stock market will have a stream of royalties than an asset intensive real estate business. what jack in the box has done is gone through a conversion and they've sold off their stores to their franchisees and now by the

end of this year they'll be 70% franchise model versus 70% company owned and taken those hundreds of millions of dollars that they got from the sale of those stores and repurchased their stock at a low valuation. they also own qdoba, a fast mexican business which is growing significantly and a hidden asset inside of jack in the box so it's a combination of conversion to a franchise model, buy back a lot of stock and highlight the value of qdoba. >> cliff we have to run but one question, i wrote a column in "the times" private equity, used to be in the business about the trillion dollars of dry powder on the balance sheets right now. do you expect to see a wave of m&a in terms of especially some of the companies you bought? >> absolutely. >> he's nodding his head no, by the way. >> the magic word is extension. >> extension. >> that's what was missing from your article this morning. >> i talked about extension. >> the first line should have been extension.

>> extension, extension. >> what i can tell you about our companies and then i'll answer your question more broadly in the market. i've been a partner in j care general atlantic and our approach to investing if we're a private equity fund would we buy this company and instead of paying a big premium we're paying no premium buying sthaha in the market and becoming a lead stockholder. i see private equity looking at the same types of companies we're looking at. >> we have to leave it there but we'll have you back and talk more. >> sorr sourdough bread. >> and you like the animal prints at chico's. >> i do. it's not a high bar for me to like fast food. pledging to privatize state-run companies, greece is finally taking the first step. [ male announcer ] for the dreamers...

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welcome back, everybody. americans are expected to spend more during the busiest shopping season of the year but they are displaying a little bit more caution as well. the national retail federation says it expects sales over the winter holiday shopping period to rise by 4.1% this year. that's more than a percentage point lower than the growth of each of the past two years but remember, you are coming out of 2008 and some big dips in the numbers there. this would, though, be the smallest increase since 2009.

retailers depend on the last two months of the year for up to 40% of their annual sales depending on what their lines are that they're selling and the nrf is predicting merchants will hire about 625,000 holiday season workers. when we come back, we'll have more from our guest host, sam zell and greece is taking the first step toward privatizing a state-run company. michelle caruso-cabrera will bring us that story with the details. >> this is a real estate deal, $81 million, small but symbolic, the ceo of the company that made the investment coming up right here on "squawk box." th 8 airba, a crash management system and the world's only tridion safety cell which can withstand over three and a half tons. small in size. big on safety. hey, it's sandra -- from accounting. peter. i can see that you're busy... but you were gonna help us crunch the numbers for accounts receivable today.

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welcome back to "squawk box." chrysler reporting a september sales increase of 11.5% over a year ago, that's above estimates of an 8.5% increase, it's chrysler's best september sales performance in five years. among the stocks already on the move this morning, retailer express is under pressure after the company cut its fiscal third quarter earnings guidance. the company had an abrupt change in customer traffic in september and adds there was some improvement at the end of the month. and phosphate producer mosaic

under pressure, $1.03 per share, 12 cents below estimates, hurt by lower volumes and prices. michelle is here and we have a lot to talk about, after years of promilesses to privatize state-run enterprises, greece announced its first privatization deal in history and michelle caruso-cabrera joins us with a special guest. >> so two prime ministers ago, greece promised to do massive privatizations, raise billions and billions and billions of dollars. it's almost never happened. they have finally done the privatization of a mall. joining us is the ceo who has decided to make this investment, odyseus, you're lucky to be on, we have one of the most formidable real estate investors in the world with us sam zell, i'm sure he'll be interested in what you have to say. >> i just saw him.

>> so $81 million and a mall, is this the deal, the right metric and why did you decide to make this investment in the state-run enterprise? >> first of all, there is a symbolic meaning to this privatization because it was the first one, performed by the state privatization fund, he said so many years of promising this, so for us, and for it shows our confidence to transforming the greek company. for us the deal made financial sense, the price was fair for our parties and we acquired the premise in the front part we have developed the shopping center so we want to develop the back part in a way that would be complimentary to the use of our shopping center that we have developed in the front. >> how big is the property, and how much did you end up spending, over 90 years, is it

$81 million over 90 years for 73,000 square feet? have i got that right? >> that is correct. when we start developing the back part of the property we'll invest another 20 million euros to do it the right way. you can calculate at least 100 million euros. >> but over a very long period of time, right? sam zell, what do you think of this, when you hear the metrics on this deal? >> i don't know enough about the greek specific real estate environment. you're talking about paying $1,000 a foot for a 73,000 square foot shopping center. at least in the united states a shopping center like that would cost dramatically less. on the other hand 90-year financing terms aren't available in the u.s. so therefore you got to do a present value and determine what they're really paying. looks to me like for him it might be a great deal but in terms of greece, you know, present value of a 90-year

obligation, i can't do my math quick enough in my head but i'd suggest it's worth maybe 30% or 20% of the face amount. that doesn't make it a bad deal and maybe this is symbolic, but you'd think if greece wanted to do something, they would privatize the railroads or privatize the electricity or privatize something where the act itself would dramatically change the environment. this doesn't do that. this may be a wonderful transaction for this gentleman, but i don't know what it does for greece. >> he brings up a great point, mr. anathasios, people talk about privatization and greece they talk about the railroads, the oil company, et cetera. can this really be symbolic or is this simply the troika, the government of greece trying to please the troika so they can get that next 30 billion euros worth of bailout money that the country so desperately needs? >> no, i think it's more than a

symbolic view or a first step as we said before and actually the time plan we have as a next step for greece the privatization of the company and there is a company schedule to be privatized and i think no matter what we say here that actions are louder than words and over the next three or four months we'll see where this goes. the thing they can say is that we seem to see a real determination from the prime minister and some of the key members of the cabinet, like the finance minister or the minister of development to want to go ahead with the program, and i hope my judgment is right because this is crucial for the country. >> are you convinced that greece is still going to stay in the euro a year from now? >> i'm convinced that the government and other important players in this are determined to stay and this will do whatever they can because they think this is our last chance to stay in the only place where we have a chance to be a successful

country. >> many people say you should absolutely lead, leading economists say you should do that, your labor and property and everything else would be cheaper and far more likely to get investors. why don't you buy that? >> i tell you my opinion of this, labor is an important part of the cost of any product but if you put the numbers down the labor cost is only a fraction of the cost in most products we produce here and on the other hand we have other sources in which greece is rich, i'm not talking about natural resources. i'm talking about industries like the tourism industry, we haven't exploited the full potential, we have alternative source of energy like solar energy or wind energy, we have agricultural output that we don't take advantage of, so there are ma so many resources and opportunities in greece, it's not a matter of the private sector doing poorly or a lack of

resources, but it's rather how the state is operating, we have a big public sector as you know, we have tax evasion and we have no privatizations. if we change these things if we're not a state controlled economy but instead a private controlled economy we can see a different picture and to me by staying in the european union this is where we should concentrate. it's not how much you value the currency or you divide the labor cost but what kind of economy you are, where you wish to go. >> that's similar to the debate we seem to be having here in the united states. thanks so much for joining us this morning and congratulations on your deal and good luck with it. >> thank you very much. >> thanks for playing, sam. that was helpful. good to have you on the set. >> just look at that shot, crumbling infrastructure everywhere. they've neglected things for -- >> thousands of years. >> it's a beautiful building and they're going to put gucci and apple and everybody in it. and they're all going to buy it

with overvalued euros. >> exactly. much more still to come, thanks, michelle. >> you're welcome. >> from our guest host, sam zell and don't miss "squawk box" tomorrow, we'll talk to the ceo of mondeles, formerly kraft foods, irene rosenfeld, since the company left the dow jones industrial average after the split. 2550 tdd#: 1-800-345-2550 and the streetsmart edge trading platform from charles schwab... tdd#: 1-800-345-2550 gives me tools that help me find opportunities more easily. tdd#: 1-800-345-2550 i can even access it from the cloud and trade on any computer. tdd#: 1-800-345-2550 and with schwab mobile, tdd#: 1-800-345-2550 i can focus on trading anyplace, anytime... tdd#: 1-800-345-2550 until i choose to focus on something else. tdd#: 1-800-345-2550 trade at charles schwab for $8.95 a trade. tdd#: 1-800-345-2550 open an account and trade up to tdd#: 1-800-345-2550 6 months commission-free online equity trading tdd#: 1-800-345-2550 with a $50,000 deposit. tdd#: 1-800-345-2550 call 1-800-836-8799.

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welcome back to "squawk box." we have a great guest host, equity group investments chairman sam zell. sam, at the top of the 7:00 hour, for anybody who wasn't awake yet, hadn't tuned in yet, you talked about how you do corporate enterprise installations, and when you watch those things and you see delays that signals a recession is coming. what do you see specifically? >> i see we have a company that is in the business of creating enterprise, in other words, providing an enterprise service, where they complete a whole package of stuff. and one of the signs that they have of where we are, is when they see all of these projects start to get delayed, that's usually one of the first signs that we're heading into a recession, in other words, instead, the project was supposed to be done in three months and now somebody at corporate says well we'll postpone it for nine months and you start seeing that, and we see that in a lot of our companies, not just that one. >> where is it happening, around

the country? >> everywhere. maybe except texas. but what we're seeing is that i'm not as optimistic about consumer spending for the end of the year. i think the environment is tough, and the confidence is low, and when you have a tough environment and low confidence, i've been somewhat, i don't want to use the word depressed but become somewhat of a pessimist. the one thing sam has been is the giant optimist, the bottom of every market sam is buying stuff. and my problem, and then i had this epiphany and i said you know the problem is, if my assessment of the realities are such, everything is massively too expensive. in other words based on the fiscal cliff and all of the head winds the stock wins should be 9,000, not 14,000. the stock marked is getting bullied by qe7 or 8, whatever

number it is so we're creating artificial numbers that i don't think the underline will support. >> if barack obama is reelected, would that put you in a state of you might be dprelsed a little bit longer probably, wouldn't you? >> well i just think it would be a continuation of how i am today. >> what do you think right now, are you, do you think he'll be reelected at this point? >> i'm not a political prognosticator. >> off camera you wouldn't say yes or no? you don't know? >> i don't think barack obama has been the best president we've ever had. i frankly think that he has been one of the poorer presidents we've ever had. from my perspective i would be happy if there was a change. >> say he gets reelected and four years from now, can we still, you know, pull back on some of the shift towards an entitlement state that comes through the next few years? do we still have a chance to right this ship four years from now?

>> i think the re-election of president obama would likely make righting the ship much more difficult. >> four years from now. >> four years from now. we talked about structural in the economy, we're also going to talk about structural within the agencies. eight years of lisa jackson at the epa is something to be really concerned about. eight years of this nlrb, we could be reunionizing the whole country and somebody would write a bill says you can't have right to work. >> say romney wins, how quickly, in your estimation, do things turn around? what happens? what is the shift? to the extent, can you impact any of this? >> that's the caveat i was going to give you. >> i think whoever is elected president in a month from now, they will have to do major, major stuff.

obviously you got two different ideologies, and i think if romney were elected, he's going to have to do major stuff, absorb major pain, but hopefully create a base from which the country can grow again. i don't think increasing meld i care is going to increase the growth rate of the country, and create more jobs, as an example. >> flip it around. if you take some of those things away, there is an argument to be made, and maybe you don't agree with it, there's going to be some pain at least in the short term. what does that do to the economy, in your views on where we ultimately go? >> i basically think that the last five years has been all about somebody sticking your finger in the dike. they didn't solve the problem. they stuck their finger in the dike and we know the dike's eventually going to go. and so all i'm saying is we have

to address and solve problems. we have solved very few problems. i think time is up for whoever wins. the question is, how will that person react? we saw president obama lose big time in 2010, and as opposed to bill clinton who moved to the center, he moved further to the left. how will he respond if he gets reelected? that's a little scary. and i don't know how much further to the left he could run. >> was kicking the can down the road the right thing for a while? you say putting your finger in the dike, the hope was that the waters would recede some so that when it did burst it wouldn't be quite as bad. >> you stuck your finger in the dike because you were afraid to do what every scenario requires. you've got to clear the market. if the single family housing market had been allowed to fail as you would use your term we would have a viable, terrific

housing market today, because it would have cleared. by virtue of not allowing it to clear, we have 4 million or 5 million houses in purgatory. >> the foreclosures. >> all of that stuck because nobody was willing to say, a is a, b is b, face up, next. let's reclaim up. let's suffer and go forward. let's build tomorrow. policy that doesn't acknowledge reality has never succeeded in the history of the world, and that's really the policy of the last four years. it's been stick your finger in the dike, hope for something good to happen. >> what worrole do you think be bernanke has played in all of this? >> the idea of all of this massive amounts of liquidity, each time he increases it, the impact is less and less. you would think that maybe it's time to think of it, you know, another solution, because it ain't working. we've had, i don't know, three

or four qes. >> the third. >> we bought cars from people at inflated prices and encouraged them to buy houses, did all of these things and nothing worked. if it was your life or my life, we would have changed things three years ago, right? >> right. >> you wouldn't have sat there, well i'll just suffer until -- like the 2000-year-old man by mel brooks, oh, yeah, what happened? i got run over by a chariot. what'd do you? he said i laid there until i got better. i didn't have insurance. my point being that's not a solution. you've got to take action and you've got to face up to reality. that's all. it's not complicated. it takes a lot of courage and it's going to break a lot of eggs, but don't you think it's time to break some eggs? for everybody. >> we're going to have more from sam zell in just a few minutes, again he's been our guest host for the last hour and 45 minutes and we've got him for about 13

more minutes. >> bringing us some very compelling -- we got a lot more talk about, compelling views. coming up stocks to watch, we'll check in with jim kraimcramer a nyse. tomorrow our guest is james tisch, president and ceo of loews corporation. [ male announcer ] the 2013 smart comes with 8 airbags, a crash management system and the world's only tridion safety cell which can withstand over three and a half tons. small in size. big on safety.

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welcome back to "squawk box." jim kramer is standing by at the new york stock exchange. did okay yesterday, indicated higher today. it's still working, jimmy? >> yes, it is. the money is still coming in. this is about qe-7 or 8, i have been riveting all morning. what mr. zells said is similar to what steve jobs said before passing away. this is a country where it is just too hard to do business in. >> yeah. i was going to say, you're not much of a golfer guy but a tennis guy, right? >> ryder was just a collapse. >> yeah.

we let pollster on -- for me it was going to a shrink or something. it was come peopling but my heart was racing, i had butterflies in my stomach and didn't think it could happen. when it did, i felt hollow after it. >> i had a bunch of guys going to the eagles/giants game. you would have thought either of the games would have been talked about. the ryder cup is all i heard about. people felt bad for america. it was a patriotic thing. >> for one eagle moment, i just thought, i don't know, ma lays, i thought, we can't do this right. >> if they come in with cardigan sweaters the next time we see the golfers with the cardigan and have to start talking about turning down the thermostat, it is pool game over. >> all right. jim, thank you. we'll see you in a few minutes. all right. we'll see jim in a few minutes

at the top of the hour. when we come back, final thoughts from our guest host today with his take on emerging markets. and we have a big show tomorrow. the guest host is jim tesch, the chairman and ceo of mundelay foods. irene rosenfeld will be joining us since her company left the dow. and jim grant. and if you stumble, you get back up. up isn't easy, and we ought to know. we're in the business of up. everyday delta flies a quarter of million people while investing billions improving everything from booking to baggage claim. we're raising the bar on flying and tomorrow we will up it yet again. mike rowe here at a ford tell me fiona, who's having a big tire event? your ford dealer. who has 11 major brands to choose from?

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the stock of the day, i like to call it the debacle dejour of the day, for your fyi. it is down now. i know debacle dejour is wrong now, i'm still going to say it. the apparel retailer warning they will miss their third-quarter earnings as sales weakened in september. i guarantee i'll get e-mailers to say i used the word -- i even put another one on there. i think i'm back to regardless. anyway, are you going to lead us here, you have arianna coming in

to back you up on thursday, but while you still have him here, give him some new york times. >> i want him to talk about the alan blunder piece because he did read it in "the wall street journal" today. do you think it is right or wrong? >> my first argument above that is law professors shouldn't be president. lawmakers don't make decisions, they show both sides. so we have to eliminate law professors and then eliminate ceos, too. if i had to make a choice of who i would want to leave the future to, a law professor or a ceo, it is not a hard choice. >> i'll ask you on taxes, yesterday you were on the paul ryan clip, but there is a debate over the romney tax plan, not that he's not going to lower taxes, he may lower taxes and that may be a good thing for the economy, but the question is ultimately does it bring in enough revenue to make it revenue neutral?

one of the things they have said about republicans is it would lower the deficits but the taxes have exploded under them. your views? >> there's no question the deficits have exploded under them. the last two decades among the two wars and the mistakes in my opinion, we blew a lot of money. multiples of what we blew before. so, you know, my attitude is that -- >> jimmy, my question is do you have any confidence no matter who is in office that actually the hard cuts that need to be made ultimately to make any text plan deficit neutral are actually going to happen? >> and my question to you comes down to a simple question. >> do you believe in the tooth fairy? >> who does the president listen to? i wonder if you could name for me four or five executives who have been advising the president and that he's been listening to. okay, four. okay, three.

okay, two. okay, one. i'm waiting. one name. >> well -- >> you would argue -- >> if you think general electric the irrelevant to what's wrong with the country today. >> we have steve case on the air a lot who makes that argument. i think you are probably more right than wrong. >> ubs was losing their clients because of their affiliate with robert wolf. yeah. >> the answer is i don't think there are any simple answers. i don't think there's any magic potion. i think the most important thing is we have to learn there isn't a magic potion. and i'm very much -- i'm not against raising taxes at all, okay? and that makes me different than a lot of players in the republican party. but number one, you raise taxes, you raise everybody, you lower taxes, you lower them on everybody. should we have tax reform?